BGE mouse over doesn't work. How to fix it?
Yes the object can not be set to No Collision, Occluder and Sensor also do not work. 

The mouse sensor will detect any static, dynamic, rigid body, soft body, and character objects.

To make testing easier enable the mouse pointer in the game.


Then set up just a Mouse sensor, set to Mouse Over, and some actuator like Visibility, or End Object just to test the mouse interaction. Put that on the default cube.